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DEFINITION of 'Federal Poverty Level-FPL'. The set minimum amount of gross income that a family needs for food, clothing, transportation, shelter and other necessities. In the United States, this level is determined by the Department of Health and Human Services. FPL varies according to family size. The number is adjusted for inflation and reported annually in the form of poverty guidelines. Public assistance programs, such as Medicaid in the U.S., define eligibility income limits as some percentage of FPL.
Definition: The Federal poverty level is the indicator the U.S. government uses to define who is poor. It measures a family's annual cash income. That's how it differs from other poverty indicators that measure total wealth, annual consumption, or a subjective assessment of well-being.